Buy low and sell high. Buy and hold.
Those invested in stocks will tell you that those are words to trade by.
And they're not wrong.
But what if there was a way to sell low when it's the lowest it's been?
Definition: Short – to sell a stock, currency, etc in the market without having first owned it.
The wonderful thing about currency trading is that I can short, or sell, the market all day long without having bought it first.
Isn't that nice?
Yes, it does matter what's happening in the world and we'll get into that later - it's simpler than you realize.
But we don't have to wait it out and not make money as the markets continue the downward trend.
That’s the literal downside to the philosophy of buy low and sell high as well as the buy and hold concept.
Earlier this year when the worldwide pandemic hit, people lost money left and right in the stock market.
Even 401(k)’s invested in mutual funds were hit hard.
What then for the buy low and sell high investors?
Buy and hold.
When asked where their money went, most did not have an answer. In fact, it was something many hadn't considered.
Beyond the nightly news reports, all they really knew was that they lost because of this or that with the economy, businesses, etc.
So, where did the money go?
It didn't just evaporate into thin air like magic, right?
No, not at all. But the buy low and sell high mentality changes.
The beautiful thing about the Forex Market is that we do take advantage of fluctuations in the market, never skipping a beat.
We are nimble enough to adjust and adapt as things in the world happen. Having to buy low and sell high are not constant factors.
And the best part – we continue to advance our finances through a buy or a sell.
Where there is a loser, there is also a winner. Just like having night and day, up and down, happy and sad.
With the law of opposites at work, we know how to use it to our benefit.
So, now that you have the basics down, next week I’ll share more about the mechanics and psychology behind Forex trading.
If you can’t wait that long, check out this information.
And to answer everyone’s burning question: no this isn’t like gambling in Vegas.